The Ministry of Energy has clarified that no contract has been signed between the Tema Oil Refinery (TOR) and its potential partners, Torentco. While negotiations are ongoing between the state agency and Torentco, no final agreement has been reached, according to the ministry’s spokesperson, Kofi Abrefa Afena.
In a press statement released on Sunday, June 25, Afena urged critics of Energy Minister Dr. Matthew Opoku Prempeh to verify their allegations before making them public. He emphasized the minister’s commitment to revitalizing TOR in line with the vision of the President, with the board, management, and staff of the company acknowledging the minister’s positive interventions.
The government aims to find strategic partners for the refinery, and key state actors such as the State Interests and Governance Authority (SIGA) and the Attorney General’s Department are involved in the process, added Afena.
TOR, a crucial entity in Ghana’s energy sector, has faced significant challenges in recent years, including operational inefficiencies, financial constraints, and the need for infrastructure upgrades. In response to these issues, TOR’s management has embarked on an extensive evaluation of potential solutions.
After careful consideration and rigorous analysis, the management team has concluded that the Torentco deal offers the most promising path forward. However, concerns have been raised by Civil Society Organisations (CSOs), including the Africa Center for Energy Policy (ACEP), regarding the lease agreement negotiations between Torentco and TOR.
ACEP has expressed doubts about Torentco’s lack of a track record in the petroleum business and its capacity to effectively take over TOR. ACEP’s Executive Director, Ben Boakye, argued that holding Torentco accountable would be challenging if they fail to deliver due to their limited experience.
In response, TOR clarified that the proposed deal entails a strategic partnership between TOR and Torentco, aiming to modernize the refinery’s operations, enhance efficiency, and improve its competitive position. The collaboration will involve substantial investments in infrastructure, technology upgrades, and capacity expansion.
TOR’s management stated that the Torentco deal would ensure a reliable supply of crude oil, a critical input for the refinery’s operations. They also emphasized that the partnership would bring financial stability to the refinery, leveraging Torentco’s financial resources and access to capital markets for infrastructure upgrades, maintenance, and working capital.
The management of TOR believes that the Torentco deal represents a transformative opportunity for the refinery and Ghana’s energy sector. They anticipate that this strategic partnership will position TOR as a vital contributor to the country’s economic growth, job creation, and energy self-sufficiency.
The proposed transaction aims to achieve sustained positive net cash flow for TOR, demonstrate efficient processing of crude oil, and achieve industry-accepted yields, ensuring the refinery’s profitability and contribution to Ghana’s energy landscape.
